Insurance News Digest 5-9-2025

Q1 2025 financial results from several insurers, including Liberty Mutual, Root, Hippo, and Mercury General, highlight the severe financial toll of recent California wildfires. While some, like Root, posted rare profits, the industry overall faced heightened loss ratios and strained profitability amid rising climate-related risks.

May 09, 2025

We deliver the latest insights and developments shaping insurance, focused on insights and opportunities for those who serve the insurance industry. Stay informed on how emerging trends like current events, regulatory changes, AI, and innovative products can help you better serve your clients and partners and drive business growth.

Top 10 Articles Of The Week

1. Patrick Tiernan Named Lloyd’s New CEO

Lloyd’s of London has appointed Patrick Tiernan as CEO, effective June 1, 2025, pending regulatory approval. Tiernan, previously Chief of Markets, brings nearly 30 years of experience and aims to focus on performance and underwriting discipline as he succeeds outgoing CEO John Neal.

UnitedHealth faces a shareholder lawsuit claiming it misled investors by downplaying the business impact of its CEO's death and subsequent public backlash. The suit alleges the company overstated earnings forecasts, which were later cut sharply, causing a significant stock drop.

Insurers in Kansas paid out more than $612 million in 2024 for 56,778 storm-related claims, with hail, wind, and water damage topping the list. Johnson County recorded the highest claim totals, while Greeley County reported the fewest.

Manulife saw a 37% rise in insurance sales and a 36% increase in new business value in Q1 2025, driven by growth in Asia and wealth management. Despite wildfire claims and credit provisions, core earnings remained strong.

Nearly 60% of firms now view U.S. trade and regulatory policy as a major financial risk, according to a Willis Towers Watson survey. This marks a notable shift as domestic U.S. policy overtakes traditionally dominant international concerns in risk forecasting.

Florida Citizens Property Insurance Corporation has issued Everglades Re II, a $1.525 billion catastrophe bond—the largest ever in the insurance-linked securities market. The bond aims to bolster the insurer’s reinsurance coverage ahead of the 2025 hurricane season, reflecting increased investor confidence and the growing role of alternative capital in disaster risk financing.

7. Heritage Insurance Sues Adjuster Over '60 Minutes' Claims

Heritage Property & Casualty Insurance has filed a libel and defamation lawsuit against independent adjuster Jordan Lee, who alleged on '60 Minutes' that the insurer altered damage estimates to reduce payouts. Lee's attorney argues the suit aims to silence whistleblowers, while Heritage contends Lee submitted inflated estimates during Hurricane Ian claims.

A Yale-led study highlights significant disparities in life expectancy across U.S. states, with Southern states like Mississippi and Alabama showing minimal gains over the past century, while states like New York and California achieved substantial increases. The research attributes these differences to factors such as public health policies, socioeconomic conditions, and access to healthcare.

Apple's Eddy Cue testified that Google searches via Safari declined for the first time in 22 years, attributing the drop to increased use of AI tools like ChatGPT and Perplexity. This shift raises questions about Google's search dominance and its $20 billion annual deal with Apple to remain Safari's default search engine.

The nonprofit Directors & Officers (D&O) insurance market in 2025 presents a mixed picture, with some organizations experiencing stable or reduced premiums due to new market entrants, while others, particularly in high-risk sectors like child welfare and healthcare, face increased premiums and coverage challenges. Carriers are also introducing more exclusions, affecting coverage terms.

Focus Of The Week: Q1 financials from several insurers highlight the severe financial toll of recent California wildfires. While some, like Root, posted rare profits, the industry overall faced heightened loss ratios and strained profitability amid rising climate-related risks.

Liberty Mutual’s Q1 2025 net income fell 33% to $1.01 billion, largely due to $1.8 billion in catastrophe losses, especially from California wildfires. However, the company reported an improved underlying combined ratio of 81.9%, reflecting stronger underwriting performance.

Root Inc. posted $18.2 million in net income for Q1 2025, reversing two years of quarterly losses. The insurtech attributed the improvement to a 24% increase in gross premiums and a solid 95.6% combined ratio.

Hippo posted a $48 million loss in Q1 2025, up from $36 million the year prior, citing $45 million in wildfire-related losses. Despite expanding its Services segment, the firm’s gross loss ratio hit 121% in its home insurance program.

Mercury General reported a $108.3 million Q1 loss, reversing a profit from last year, driven by $447 million in net catastrophe losses from Southern California wildfires. The company’s combined ratio surged to 119.2%.

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